Over the last couple of years, Seneca Investment Managers (Seneca IM), the manager of Seneca Global Income & Growth Trust (SIGT), has been reducing the trust’s equity weighting, in advance of a global recession that it now expects in 2021. Consistent with this view, the manager has increased SIGT’s weighting to gold and reduced net gearing (3.3% as at the end of September). Whilst it may make further equity reductions, we are now much closer to the point where these will cease, and it has decided to press pause for now (SIGT is now significantly underweight equities relative to its long-term allocation). Seneca IM expects its multi-asset strategy to strongly outperform equities in the downturn, although during such a period the trust would struggle against its absolute return-orientated benchmark…. Read more
Multi-asset, low volatility, with yield focus
Over a typical investment cycle, SIGT seeks to achieve a total return of at least inflation as measured by the Consumer Price Index (CPI) plus 6% per annum, after costs, with low volatility and with the aim of growing aggregate annual dividends at least in line with inflation. To achieve this, SIGT invests in a multi-asset portfolio that includes both direct investments (mainly UK equities) and commitments to open- and closed-end funds (overseas equities, fixed income and specialist assets). SIGT’s manager uses yield as the principal determinant of value when deciding on its tactical asset allocation and holding selection.
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